Its not about sales, thats 2nd. Its because people could make more money doing something else before the 5 years it takes to build a respectable book. Yes you have to be good at sales and be good at taking rejection, but lets think about this.

A decent broker, brings in 3M the first year, 5M the 2nd.

The first year the brokers paycheck is about 15K, the 2nd year 35k, ETC. In what city can you live on those wages, and why would you. I live in Manhattan, and anyone with a pulse can get a job with operatioins at a bank paying like 50K to start, on 15K you cant even pay your rent, even if there were no taxes.

So my point, its not good enough to be a good salesman, you should have a financial cussion before and expect to live in poverty for a few years with the chance the whole thing wont work out. Who wants to take that risk, the people that stay in this business

3M in the first year is a bit low. That’s not even average. Average would be about 4.5-5M, decent would be about 6.5M+. And the goal for everyone should be about 10M a year. If the goal is only 3M, thats a bad sales goal, and then the reason those people fail is about sales.

Also, you don’t need a financial cushion depending on when you’re starting. Somebody right out of college won’t need as much as a 40 something HR manager with a family.

10M in the first year? Not many do that, if you can do that from scratch, my hat is off to you. 3M is low, your right, but even at 5M, the income level would be 25K a year. Still not much after taxes, about 20K left. To live in NYC you need to make atleast 50K if your not being subsidized from your parents or if you arent in queens or brooklyn.

Don't forget, in wirehouse training programs you can get a decent salary for two years assuming you meet certain minimums. Also, 25k assumes you are getting about 1.5% in fee-based assets on every last dollar of that 5 million.

My first year in the business was 2000. I raised about 2.5 and had production of under 60k. Was with MS at the time with a 24k salary and failed to hit bonuses. My class of 206 was cut in half by the end of the first year.

Year two finished with a total of 6MM and had production of 90k - mostly fee-based. I was canned for being in the bottom 25% of the remained 42 people in my class. For those two years I had three roomates, a 15 year old car and never worked less than 70 hours a week. Probably 5-10 of that original 206 are still with MS.

I still saved about 10k from those two years so I started my own firm with an indy b/d. Did that until 2004 when I had about 25mm AUM all fee-based, at which point I started my own RIA. In the first three years I never brought in over 5MM a year.

So...the reason most fail is they bitch about what it takes to make it in the business. That 50k a year bank job will be paying 60k in five years. Wirehouses aren't fair - they don't want people satisfied with 50k a year. They want type A a-holes who want to make millions (they just don't tell you that when you get hired). Good luck.

Good story. I agree with a lot of what you said, but my point was more that most people literally cannot afford to make so little money. So they can’t do this career to start. If you want to be in a major city its difficult to get by with such low funds.

I agree with your post about treating this as less of a sales job and more of an advisory job, however 3 mm in the first year is SEVERELY OFF. At Merrill, you need to finish with 15 mm in the first year and a half just to graduate the training program. Harsh hurdles, but it's set up that way so that you're not standing outside the office building with a cup begging for money after you leave POA.

The goal is to graduate early and collect a nice little bonus and stock options. If you graduate with just the bare minimum, you're barely treading water compensation-wise. The real goal is to just kick some @ss and keep taking names to make sure you can survive and pay the bills.

Strange that nobody seems to be talking about this for a perspective of marriage. All single living scenarios.

If your spouse is gainfully employed and they have income sufficient to cover cost of living, jumping into this arena if you have the skills necessary could end up being a huge benefit to the both of you.

Kind of like situations where the wife toils away while hubby is in medical school. She is keeping the house afloat while he gets the grades. Once he graduates and does his time in internship, she gets a huge payoff as he becomes a licensed physician with a job offer or three out the shoot.

It is a sacrifice, but living in New York I am sure a young couple where one works while the other one cuts their teeth as an FA can survive.

I agree with your post about treating this as less of a sales job and more of an advisory job, however 3 mm in the first year is SEVERELY OFF. At Merrill, you need to finish with 15 mm in the first year and a half just to graduate the training program. Harsh hurdles, but it's set up that way so that you're not standing outside the office building with a cup begging for money after you leave POA.

The goal is to graduate early and collect a nice little bonus and stock options. If you graduate with just the bare minimum, you're barely treading water compensation-wise. The real goal is to just kick some @ss and keep taking names to make sure you can survive and pay the bills.[/quote]

You need $15 million in AUM at Merrill so they can recover your training program salary through trails ASAP........

DJRoss - you make a really good point! Many people do have a perspective on these forums from the single income family model. Luckily, my wife makes a good income as a CPA, so I know my time out of POA down the road could be a bit tough for a few months, but we have her salary to get us by. My focus on this career is 4-5 years out and then the sky is the limit.

This was a career I paid little attention to when I was on the corporate/institutional side of the financial industry before (5 years prior). I explored this and soon realized that there is simply NO better occupation where you can 1) have a family and SPEND TIME WITH THEM, 2) make a GREAT income, and 3) be your own boss.

Oh, and did I mention that you spend your living working to enrich the lives of others. If that's not motivation to make it, I don't know what is.

My first year in the business was 2000. I raised about 2.5 and had production of under 60k. Was with MS at the time with a 24k salary and failed to hit bonuses. My class of 206 was cut in half by the end of the first year.

Year two finished with a total of 6MM and had production of 90k - mostly fee-based. I was canned for being in the bottom 25% of the remained 42 people in my class. For those two years I had three roomates, a 15 year old car and never worked less than 70 hours a week. Probably 5-10 of that original 206 are still with MS.

I still saved about 10k from those two years so I started my own firm with an indy b/d. Did that until 2004 when I had about 25mm AUM all fee-based, at which point I started my own RIA. In the first three years I never brought in over 5MM a year.

So...the reason most fail is they bitch about what it takes to make it in the business. That 50k a year bank job will be paying 60k in five years. Wirehouses aren't fair - they don't want people satisfied with 50k a year. They want type A a-holes who want to make millions (they just don't tell you that when you get hired). Good luck.

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Your first mistake was annuitizing a book before you built your business. Had you sol a bunch of A shares, annuitties , bonds etc. You would have succeeded you just bought into the hype the wirehouses pump build a recurring revenue for them. That way when you fail they still make money.